A Charter Serves Up More Kool Aid

The Los Angeles Times reported on August 18, 2016, that the LAUSD is considering revoking El Camino Real Charter High School’s [ECRCHS] charter, saying that “fatal flaws in judgment … call into serious question the organization’s ability to successfully implement the charter in accordance with applicable law and district requirements.” The school’s principal, Dave Fehte, sent out a response to parents, which is reprinted below along with my annotated comments:

Dear El Camino Parents,

Late Tuesday, ECRCHS received an email from LAUSD Charter School Division (CSD) informing us that LAUSD will request the LAUSD Board of Education to issue a Notice of Violations to ECRCHS at the LAUSD Board meeting scheduled for Tuesday, August 23rd at 1:00pm. This item will be scheduled as a public hearing.

The Notice of Violation accuses ECRA of financial mismanagement. It brings up issues that were alleged in previous notices, which ECRA already responded to on several occasions. It also includes unfounded allegations about purchases on staff credit cards that did not occur [1]. ECRA is currently preparing a detailed response to the Notice of Violation. We will share this with parents as soon as it is available.

Prior to receipt of this notice, our staff and Board were working cooperatively with LAUSD’s Charter School Division since we received CSD’s Notice to Cure dated October, 2015. Our staff has met with CSD staff and with the Office of Inspector General on multiple occasions, and explained that we are a new and evolving charter school constantly working to improve our policies and practices. [2] ECRCHS has provided CSD with volumes of responsive documents and has been completely transparent. The ECRA Board has already implemented many of the fiscal policy changes requested by CSD from the Notice to Cure.

On July 8, 2016, ECRCHS received a letter from CSD. This inflammatory letter made several assumptions that were simply not true. CSD scolded the ECRA Board for making changes to its fiscal policies previously required by CSD. The ECRA Board of Directors responded to this letter on July 22, 2016 with a detailed timeline of proactive actions taken by the Board before the Notice to Cure and actions taken in response to the Notice to Cure.

It should be noted that until the 2015-16 school year and a change in the LAUSD Board of Education makeup, no major concerns from LAUSD or independent financial auditors regarding ECRA’s financial management were identified. [3] Additionally, until the 2015-16 school year, ECRA did not receive any Notices to Cure from CSD. Improved financial practices, including the decision to bring in FCMAT, were implemented before the selective reporting of the LA Daily News articles. [4]

This Notice of Violations now includes additional “violations” regarding the Brown Act that have never been brought to our attention and were not a part of the Notice to Cure.  Although charter schools are not required by State Law to follow the Brown Act, ECRCHS willingly agreed to comply with the Brown Act as part of its Charter. [5] The ECRA Board has always worked diligently to comply with these provisions of law, including providing accommodations for disabled access to Board meetings and preparing very detailed meeting agendas. [6]

At all times, we have welcomed any meetings with ECRA Board members, ECRCHS administrators, CSD staff, and LAUSD Board members. We did not receive a response to our July 22, 2016 letter or any additional requests for information or changes until yesterday’s Notice; the CSD has always demanded information and changes with no follow-up. As our authorizer, we would expect LAUSD to be obligated to work with us to successfully implement the requested changes. Last year, we paid LAUSD $301,000 (well over $1 million since our conversion) in oversight fees. [7] Naturally we would assume this would cover assistance and guidance. [8]

Thank you for your support of ECRCHS. We are confident that ECRCHS will resolve this Notice of Violations in cooperation with LAUSD, and that we can continue with the work of providing our students with a great education and making this the best school year yet. As we move through this process, we will keep you informed with regular updates and ways in which you can help.

Sincerely,

Dave Fehte

[1] Fehte does not list the specific “purchases on staff credit cards” that are subject to “unfounded” allegations, but I assume that they at least include the same ones that were detailed in the story by the Daily News. In response to the author of that article, Fehte admitted that an itinerary made out to “Mr David Patrick Fehte/San Antonio Spurs” was “for ‘personal’ reasons, that he used the school card in “error,” and that he paid back the school.” He also claimed that references in school document that the expense was part of the school’s “‘Green initiative’ was a ‘clerical error’.”

While Fehte may believe that declaring the charge to be an “error” excuses the action, the fact that it was not uncovered until after the LAUSD and the Daily News investigated the school’s records proves that there were lax accounting practices at the charter. Furthermore, if the mislabeling of the charge was not an “error” but a purposeful designation meant to cover up the true purpose of the trip, then if would signal that fraud occurred. If Fehte was personally reimbursed by the Spurs for a trip paid for by the charter, then the case should be treated as embezzlement.

[2] Fehte once again makes the excuse that they are a “new” charter. According to the ECRCHS website, it became a charter in 2011. This seems like plenty of time to learn basic accounting principles and the laws regarding open public meetings.

[3] Unless Fehte is making the accusation that District 3 Board member Scott Schmerelson stole his school-issued credit card and made charges that benefitted Fehte, it seems odd that he blames the school’s problems on Schmerelson replacing Tamar Galatzan on the LAUSD Board. In fact, if he is saying that the same lax accounting practices have always existed, the more relevant question should be “why didn’t the LAUSD find these problems sooner?” Is Fehte admitting that there was coordination between him and Galatzan that prevented an earlier investigation?

[4] On June 24, 2016, it was reported that “El Camino requested that the Fiscal Crisis and Management Assistance Team perform a management assistance review beginning next month [July], followed by quarterly visits to monitor progress for a year.” The first Daily News article appeared on  May 22, 2016. The reporting was instigated by the LAUSD’s Notice to Cure that was submitted in October 2015.

[5] Since ECRCHS receives public funds and the LAUSD Board “has the right to appoint a member of the board of directors”, then Fehte is probably incorrect in his assertion that the charter is not subject to the Brown Act. Regardless, the LAUSD requires that charters under its jurisdiction include compliance with the Brown Act and the California Public Records Act in their charter applications. Not following the terms of the charter is grounds for terminating the charter.

[6] While Fehte may think that he deserves a pat on the back for “providing accommodations for disabled access to Board meetings and preparing very detailed meeting agendas”, these are part of the law. This same law also states that the Board cannot vote on an item that does not appear on the agenda or go into closed session without a valid reason. If ECRCHS broke these rules, then they are not in full compliance with the Brown Act.

[7] The taxpayers, not ECRCHS have paid LAUSD over $1 million in oversight fees. The amount paid is set by the charter law and is paid by the state to the authorizing entity.

[8] Oversight is a regulatory function and is not the same as “assistance and guidance.” While the California Charter School Association may have purchased a couple of LAUSD Board members, their services are still provided separately from the district.


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